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Toys R Us says Storch to step down as CEO

WAYNE, N.J. (AP) -- Toys R Us Inc. said Wednesday that Gerald L. Storch is stepping down as CEO, and the retailer is beginning a search for a new leader.

The company said Storch will remain in his position as chairman of the company's board and stay on as CEO through a transition period. Storch, 56, joined the retailer in 2006 after it was acquired by a group of investors including Bain Capital Partners LLC, Kohlberg Kravis Roberts & Co. and Vornado Realty Trust.

The privately held company, based in Wayne, N.J., is the largest specialty toy store chain in the U.S. It operates 872 domestic Toys R Us and Babies R Us stores and more than 645 stores overseas, and licenses 150 stores.

The Toys R Us board credited Storch with rebuilding the company and successfully leading it through an "extremely difficult" global economic environment. The company said it has dramatically increased its online presence under his leadership.

Toys R Us has struggled with softer sales due to tough competition and economic pressure on consumers. Its revenue from stores open at least a year, considered a key indicator as they strip away sales from recently opened or closed stores, fell 4.5 percent in November and December. The two months are crucial because the holidays can account for up to 40 percent of a retailer's annual sales, particularly a toy retailer.